Media Release Half Year Results to 31 December 2024
| Stock | Sonic Healthcare Ltd (SHL.ASX) |
|---|---|
| Release Time | 20 Feb 2025, 8:59 a.m. |
| Price Sensitive | Yes |
Sonic Healthcare Reports Strong H1 FY 2025 Results
- On track to achieve full-year EBITDA guidance
- Strong organic revenue growth of 6.1%
- EBITDA margin up 60 basis points
- Acquisition of LADR Laboratory Group in Germany to complete in July 2025
Sonic Healthcare reported a net profit of A$237 million for the half-year to 31 December 2024, on revenues of ~A$4.7 billion. The company achieved strong organic revenue growth of 6.1%, with particularly strong growth in the Australian (9%), German (7%), and UK (8%) laboratory businesses, and in the Radiology division (12%). EBITDA grew 12%, reflecting total revenue growth of 8% and approximately 60 basis points of margin expansion. The company's cost reduction initiatives, including a 50 basis point reduction in labour costs as a percentage of revenue, contributed to the margin expansion. Sonic's Swiss business achieved 6% organic revenue growth, and the US business grew 2% organically, though with weaker than expected growth in anatomical pathology revenues. The company's Belgian business saw a slight revenue decline, but a 3% indexation of fees from January 2025 is expected to assist growth in the second half. In December 2024, Sonic announced the acquisition of the LADR Laboratory Group in Germany, a major growth milestone for the company's 20-year presence in the country. The acquisition, which will complete on 1 July 2025, is expected to be immediately earnings per share accretive and offer strong post-synergy returns on investment of more than 11% per annum.
Sonic Healthcare is on track to achieve its full-year EBITDA guidance of A$1.70-1.75 billion on a constant currency basis, provided in August 2024.
Sonic Healthcare expects ongoing earnings growth driven by strong organic revenue growth and consequent operational leverage, as well as enhanced by the realisation of synergies from recent acquisitions, benefits from the rollout of an enhanced revenue collection system in the USA, the new Hertfordshire and West Essex NHS outsource contract in the UK, annual fee indexation in various markets and contracts, including Radiology, UK, Belgium, SCS and Australian Pathology, and the LADR acquisition.